Recommended Games

ABM Industries Modifies Credit Facility

Business services provider ABM Industries Incorporated (ABM) recently amended its existing credit facility to improve its financial flexibility and augment liquidity. The modified credit agreement is likely to provide the requisite wherewithal to undertake strategic investments for steady organic and inorganic growth of the company.

The amended credit facility increases ABM Industries’ borrowing capacity from $650 million to $800 million. By the end of fiscal 2013, ABM Industries had an outstanding debt of $315 million under its credit facility. The modified credit agreement also extended the debt maturity from 2016 to 2018 and reduced interest burden by changing to a flat 1% rate for letters of credit.

ABM Industries’ strategy entails growth through acquisitions. The company expects to extend its global footprint as well as strengthen its position in existing markets through successful integration of these companies and organic growth across the industry verticals. The increased liquidity is likely to boost this corporate objective of ABM Industries.

Furthermore, ABM Industries has a healthy pipeline of future businesses and is particularly going strong in government business. The company expects to continue its bull run in the coming quarters with continued healthy margin improvements and seamless integration of acquired businesses. Management also reiterated during its last earnings call that corporate restructuring initiatives were well on track to have sustained long-term growth momentum. An improved financial flexibility through an amended credit agreement is expected to supplement such initiatives of the company.

Headquartered in San Francisco, CA, ABM Industries provides engineering, janitorial, parking, and security services to commercial, industrial, institutional, and retail facilities across the U.S. as well as Puerto Rico, British Columbia and Canada.